The company is said to have about $6.5 billion of debt and has rejected various restructuring proposals from creditors.
The plan is now to apply for a pre-packaged Chapter 11 bankruptcy procedure.
The company ran into trouble when it lost both Tesla and Volkswagen as customers which resulted a loss of about 15% in revenue
Wolfspeed’s 32% share in the SiC market has now dropped to 19% because of competition some of which came from China.
It is said to have 25% utilisation at it’s New York fab.
Although it was due to get $750 million from the US Chips Act Act there are doubts that it will now be paid.
